Friday, October 09, 2015

If problems are huge solutions must be tough.

Suicides by farmers is regular news in India. It maybe common, but remains extremely distressing because it is an unnecessary waste of a life and suicide by a man leaves his wife completely helpless, with large debts to repay and children to feed. One professor writes that virtually all the suicides are in men because men are unable to handle the shame of not being able to provide for their families. Suicide rates are the highest in Maharashtra because of the high incidence of first cousin marriage, which means the man loses face among his own relatives, whereas in north India, where men are not related to their wives, they are comfortable taking dowry from their in laws. The good thing is that the share of total rural population in India has dropped from 76.7% in 1981 to 68.8% in 2011, share of agriculture in total employment has dropped from 64.9% in 1987 to 48.9% in 2012 and the share of agriculture in India's GDP from 24.6% in 1987 to 15.1% in 2012. This means that large numbers have moved to cities in search of jobs which provide a steady income and are not dependent on the vagaries of weather. The bad news makes grim reading. In 2011 life expectancy at birth was 5 years less for rural people compared to urban people. Literacy rates were 68% for men and 59% for women, infant mortality rates were 48 per 1,000 births compared to 29 in urban India, almost 20% had no access to safe drinking water in rural areas and 70% had no sanitation facilities. Socialist policies have been responsible for this mess. Vast amounts of money are wasted in doling handouts, such as the NREGA scheme, but all farm income is completely exempt from tax, which helps only rich landholders and is a very useful avenue for money laundering. Many states provide free electricity for farmers, to get votes, which means that many electricity boards are bankrupt. Outstanding loans on Kisan Credit Cards has reached Rs 6.48 trillion, which are misused by many to buy household goods or for holidays, with no intention of repaying the loans. Rich farmers know that politicians will respond to suicides by forgiving all loans to farmers. This is known as loan waiver and is an easy way to use taxpayer money to buy votes. It leads to farmers becoming prey to bank officials. If the same amount of money is spent on improving irrigation it will ensure farmers earn money even in drought years. It maybe no coincidence that the highest rates of suicides are in Maharashtra where Rs 700 billion was spent on irrigation schemes which do not exist. An insurance scheme for farmers and affordable healthcare for all Indians will be most useful. Finally, poor farmers are poor because they have small landholdings. This is because land is divided among children, making each subdivision even smaller. The only answer to all problems of poverty is to stop childbirth. The only way is to target subsidies to those with one child or none. We must protect our children.

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